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November 24, 2020

Colorado regulators pass tighter rules for new oil and gas wells

Colorado’s energy industry regulators passed tighter rules on the permitting process for new oil and gas (O&G) wells in a move to prioritise public health, safety and environment.

By Himaja Ganta

Colorado’s energy industry regulators passed tighter rules on the permitting process for new oil and gas (O&G) wells in a move to prioritise public health, safety and environment.

As per the new rules passed on 23 November by the Colorado Oil and Gas Conservation Commission (COGCC), there is a need for a ‘2,000ft separation between wells and homes’ or other public spaces, which is 1,500ft up from the current setback of 500ft.

Some of the other changes passed by COGCC include approving a prohibition on routine flaring and providing high protection for wildlife resources.

The regulators also approved measures to address adverse impacts to public health and safety by developing a new programme with the Colorado Department of Public Health and Environment (CDPHE).

Also included as part of the new regulation is the ‘complete overhaul’ of the current permitting methods in order to create a consolidated permitting process.

In September, preliminary approval was given for the rule, and awaited a ‘unanimous vote’ by the five-person Colorado Oil and Gas Conservation Commission..

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The latest rule of 2,000ft separation will take effect on 15 January. It was, however, opposed by some industry groups.

The new regulation enables drillers to seek exceptions in certain cases.

Following the vote, COGCC Commissioner Bill Gonzalez said that the new regulation allows ‘transparent and protective oil and gas development’.

“These rules do not effectively ban oil and gas development in the state”, he added.

Previously, Colorado state activists had tried to pass similar law in the state.

According to the latest data from the industry group US Energy Information Administration (EIA), Colorado state produced 444,000bpd of oil in August.

Currently, the 4,600 permits for new oil and gas wells before the commission will fall under the purview of the new regulation, according to the commission spokeswoman Megan Castle.

The latest rules were set by the COGCC to align with the agency’s new mission set under Senate Bill (SB) 19-181.

The Denver Channel reported the main function of COGCC was altered last year when SB 19-181 was signed into legislation. The Commission’s mission has changed from ‘fostering’ to ‘regulating’ O&G development so that it can safeguard public health, safety, environment as well as the wildlife resources.

Industry group API Colorado executive director Lynn Granger said: “The rules will likely give untethered discretion to the Director and the commission.”

Granger also added that API Colorado will ‘work closely with the commission, staff and energy-producing communities to better clarify and implement the rules’.

In November 2013, Colorado regulators proposed air quality rules to make the state the first to directly regulate detection and reduction of methane emissions that are associated with oil and gas drilling.

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